Minos and Department of Family and Community Services - [2000] AATA 1104

DECISION AND REASONS FOR DECISION [2000] AATA 1104

ADMINISTRATIVE APPEALS TRIBUNAL )

) No V2000/590

GENERAL ADMINISTRATIVE DIVISION          )
           Re      ARTHUR MINOS
  Applicant
           And    SECRETARY, DEPARTMENT OF FAMILY & COMMUNITY SERVICES
  Respondent

DECISION

Tribunal Mr J. Handley, Senior Member

Date8 December 2000
PlaceMelbourne

Decision      The decision of the Social Security Appeals Tribunal made on 4 May 2000 be set aside and in substitution IT IS DECIDED- i)   Part of the compensation monies paid to the applicant should not be regarded as having been made and ii) By reason of the special circumstances of the applicant the amount to be disregarded is a sum sufficient to permit the preclusion period as ending on 7 March 2000.
  .........Sgd. Mr J. Handley...........
  Senior Member
CATCHWORDS
Social Security – Preclusion period – applicant sold and purchased another home after settlement funds received – house transferred into name of former wife – trust for children – applicant severely ill and life expectancy reduced – negligent advice - all monies expended – whether circumstances 'special'.
Social Security Act 1991
Re Beadle & Director General Social Security 1984 6 ALD 1
Groth v Secretary, Department of Social Security 1996 40 ALD 541
Director General of Social Services v Hales 1983 47 ALR 281

REASONS FOR DECISION

8 December 2000 Mr J. Handley, Senior Member

The applicant applies to review a decision of the Social Security Appeals Tribunal ("SSAT") made on 4 May 2000. The SSAT then decided to affirm a decision previously made by an officer of Centrelink to impose a lump sum preclusion period between 2 October 1999 and 24 September 2004. That decision was made following receipt by Mr Minos of lump sum compensation in settlement of a claim for damages against his former employer. The effect of the decision is to deny payment to Mr Minos of Disability Support Pension within the above period.
The applicant was represented at the hearing by Mr Serong and the respondent by Ms McInnis. Evidence was heard from the applicant, Dr Kouzmin and Ms Hunter, a Financial Counsellor.
At the commencement of the hearing Mr Serong indicated that he and Ms McInnis had agreed on some of the facts in this application. The facts agreed were-
· The applicant continues to suffer severe back pain and his mobility is restricted as a result of a lumbar disc prolapse suffered at work in 1995.
· The applicant suffers chronic hepatitis and liver damage, which has been caused and or accelerated by the analgesic and psychotropic medication prescribed for the back pain.
· The applicant suffers depression and anxiety attributable to his inability to work.
· As a result of the above agreed facts, the applicant is unlikely to ever work again.
· The applicant is taking considerable amounts of medication at present.
· The applicant currently does not receive income.
· The applicant has six children two of whom were adopted by him after meeting his former wife. Four children are his natural children with his former wife.
· Mr Serong indicated that he and Ms McInnis had agreed that the matters in dispute were-
· The applicant used his settlement monies of $220,000 in the manner set out at page 4 of the reasons for decision of the SSAT and that there are no monies left from that settlement and
· The applicant transferred the title to his property at 24 Bluebell Drive Epping to his former wife for the benefit of his children.
Ms McInnis indicated at the outset that the respondent denied that there were any special circumstances with respect to the applicant, having regard to the manner in which he disposed his compensation monies. She submitted that it would be alleged that the applicant was not prudent, that he had prior knowledge of a preclusion period, that he has denied the existence of assets and he retains a beneficial interest in real estate, which is realisable.
Helen Kouzmin
Dr Kouzmin is a physician to whom the applicant was referred initially by the solicitors who acted for him in the Common Law Proceedings. She has subsequently been his treating doctor. Dr Kouzmin was initially asked to express an opinion with respect to the applicant's capacity to return to work but eventually became the "manager" of his treatment and assumed responsibility for co-ordination between all of his doctors. The applicant has been treated by General Practitioners, Orthopaedic surgeons, a physiotherapist, a chiropractor, a physician, a psychologist and psychiatrist. She initially attended the applicant once monthly but recently has been attending him on up to two occasions per week.
In a report of 26 October 2000 (obtained for the purposes of these proceedings) Dr Kouzmin summarised her treatment of the applicant since August 1996 and provided a prognosis.
Dr Kouzmin reported that the applicant suffers from chronic low back pain, bronchial asthma, hypertension, depression and chronic alcoholism, liver failure and hepatitis C. She said that the applicant's "main problem" is chronic hepatitis C. She said it probably has a duration of some 20 years. Additionally, the applicant suffers from severe liver failure associated with his chronic alcohol consumption and consumption also of prescribed drugs. She said the applicant's liver was so damaged that he was incapable of now taking any analgesia, to relieve his pain and is prescribed methadone to help him withdraw from prescription medicine. She described the applicant's chronic low back pain as more particularly described as lower nerve root compression which in the absence of pain killing medication prohibits the applicant from moving freely and sleeping and affects his concentration. The applicant apparently does continue to take pain killing medication from time to time when his pain becomes intolerable and "at the expense of his liver". She said that the applicant has a life expectancy of "a decade at the most" because of his liver disease. Dr Kouzmin was concerned that the applicant's present fatigue and recent weight loss may be indicative of the commencement of the disease entering a terminal stage. She said that when the disease does manifest "his demise will be swift".
Dr Kouzmin said that the applicant's combination of medical problems was unique in her experience of 35 years in practice as a physician. She said that she had "tried every known drug" to relieve his depression but this medication has produced adverse side effects or has aggravated his liver disease. The applicant is only prescribed small doses of Valium from time to time. She said the applicant's present impecunious circumstances caused him to worry to the extent that he was "under siege and did not know where to turn". She had noted that one of the applicant's psychiatrists had reported that the applicant had suicidal ideation however she had not observed this but had observed the relationship between the applicant and his children and was of the opinion that the whole of his life was directed towards protecting his children.
In cross-examination Dr Kouzmin said that the applicant's alcoholism and depression were long standing and probably commenced as a teenager. She said these conditions together with Hepatitis C were not related to the injuries he suffered in his common law proceedings. She said the Hepatitis C probably occurred by use of intravenous drugs as a teenager or having been tattooed also as a teenager.
Dr Kouzmin said she had discussed the applicant's reduced life expectancy with him and she was impressed that his "chief concern and need was to care for his children". She said that the applicant maintained the belief that he had to provide for them now because "he won't be around in the long term to do this".
Arthur Minos
The applicant is presently 41 years of age. He has four children from his marriage in 1993, which unfortunately resulted in a separation in 1995. His wife had two children from a previous relationship and the ages of all six children range from 6 years to 19 years. All children have been baptised in the Greek Orthodox Church.
The eldest two children were fostered following the breakdown in the applicant's wife's former relationship but following interviews by care agencies the applicant and his wife were successful in removing the children from care and an adoption order was made in favour of the applicant and his wife.
The applicant said that his wife and her brother and sisters were abandoned as children by their mother and he wanted to ensure that his children did not ever suffer a similar experience. He said he has always attempted to "provide the best I could".
The applicant purchased his home in 1996 or 1997 after separation. He borrowed $120,000 and purchased a house and land at 15 Gibbons Drive in Epping. He said the property was purchased for his wife and the children because he wanted the children to be given security and a place that would eventually become their own. In 1999 after the children had grown and the property at Gibbons Drive had become too small the applicant sold at Gibbons Drive and purchased a house and land at 24 Bluebell Drive in Epping. He said the house at Gibbons Drive was sold at $160,000 and the property at Bluebell drive was purchased at $205,000. Additional monies were borrowed (refer later).
The applicant had previously been employed as a labourer, barman, storeman, garage worker and truckdriver. He had always been employed in unskilled type occupations.
In 1995 he suffered back injury when employed by a company which manufactured veneered particleboard. The applicant's job was to drive a five tonne truck and deliver the board. The applicant said at the time of injury his employer was short staffed and there was little machinery available to load and unload trucks. The applicant said he loaded 4 ½ - 5 tonnes of veneered particleboard daily which was 8 feet by 4 feet and 18 mm thick. Each sheet weighed 35 kilos. In September 1995 he suffered jolting type pain in his lower back when he slipped when carrying a sheet of particleboard. A few months later he again suffered back injury when carrying a sheet at a customer's premises. Weekly compensation was claimed the following year after his back deteriorated and liability was accepted by a workcare insurer. The applicant said he had continued to work despite the presence of back pain because he was anticipating promotion. He was during this period of time attending night school to enhance his prospects of promotion. The applicant regarded promotion as a means of obtaining a greater salary, which would permit him to make greater provision for his children.
The applicant eventually claimed compensation on the recommendation of an orthopaedic surgeon. When the applicant did claim upon his employer he was ridiculed and reference was made to his Greek background. He was not assisted by the employer by the provision of claim forms and was summarily dismissed. On the recommendation of his chiropractor the applicant eventually obtained legal assistance. The applicant rejected advice as to commencing proceedings for unfair dismissal because of the impact that it may have had upon the regularity of the income he was then receiving from workcover.
Eventually common-law proceedings were instituted and from time to time the applicant was required by his solicitors to pay costs in advance. The applicant estimated that he has paid his solicitors in excess of $50,000. Eventually the County Court ordered the parties to attend a mediation conference and the applicant was advised by his solicitors that he could expect damages in the range of $500,000 - $600,000 should the matter proceed to a hearing. The applicant said that he sought enough funds only to pay out his mortgage. The applicant recalled that the mediator during the conference was "frustrated" and negotiations broke down.
Some days later, and in the absence of his solicitor, the applicant contacted the mediator directly and expressed his concern as to the quality of his legal representation. The applicant said the mediator made a similar comment.
The applicant and the defendants Solicitors subsequently entered into negotiations (in the absence of the applicant's solicitor) and when the applicant was offered $220,000 plus costs in settlement, minutes of content were signed in the presence of the mediator. Eventually the applicant told his solicitors of the settlement. Thereafter the relationship between Mr Minos and his solicitors deteriorated further resulting in part in a delay in his solicitors forwarding the signed release to the defendant's solicitors. Thereafter the applicant said that his solicitors have sent him numerous accounts and have threatened him with judgement. The applicant said that when he complained about his solicitors to the Victorian Legal Ombudsman he was contacted by his solicitors and advised his costs would be discounted if he paid cash.
Mr Minos said that the relationship with his solicitors and the tension he suffered caused him further depression and worry. He believed that his solicitors had the power to "confiscate his home" and believed that his solicitors "had power and knowledge".
Mr Minos said that he was never advised by his solicitors that he would be exposed to a preclusion period in the event of a common law settlement. Mr Minos said he discussed the preclusion period with his barrister. When the barrister learnt that the applicant had a mortgage he (Mr Minos) was told that "you should be alright".
Eventually the applicant received his settlement monies and discussed the purchase of the Epping property with a loans officer at a Bank. These discussions took place to arrange to have the mortgage transferred from Gibbons Drive to Bluebell drive. Mr Minos said that he told the bank officer that he had been advised by Centrelink that he should seek financial counselling. This advice was given after Disability Support Pension was claimed. Mr Minos said that he was told by the officer that he would not be exposed to a preclusion period because he had a mortgage. He said the loans officer had explained to him that if settlement monies were invested he would not be able to afford mortgage payments and with that advice the applicant elected to spend almost all of his settlement funds on discharge of the existing mortgage and purchase of the Epping Property. At that stage the applicant said that he was consuming considerable quantities of painkillers, anti-depressants and alcohol and he did not comprehend the transactions he was entering into. The applicant said he was then aware of his reduced life expectancy and was concerned only to ensure that the property was unencumbered.
The settlement funds were spent within a matter of days of receipt upon discharge of mortgage, repayment of a personal loan, transfer fees, repayment of monies lent to the applicant from his nephew, repayment of a visa card debt and home improvements. The applicant also purchased a motor car for his eldest son who had recently commenced an apprenticeship. Monies were also spent on acquiring furniture and air-conditioning for the new home.
When the Bluebell drive property was purchased the applicant lived in it with the children. His wife was living elsewhere. The applicant said that his wife "didn't think it was suitable for (him) to stay" and he elected to move out and she moved in. He said his main concern was for the security of the children and them having a stable and secure place to live. Despite the applicant having purchased the property alone and subsequently agreeing to move out and permit his estranged wife to live in it, he also eventually arranged to have the property transferred into the name of his wife alone but also entered into a deed of trust with her. The deed provided that his wife would hold the property in trust for him and the children, that she would "in no way deal with the property either by way of improvements, alterations or encumbrances" and that she would permit him to lodge a caveat over the property. The deed was prepared by a solicitor engaged by the applicant. He also incurred legal costs associated with this transaction.
Mr Minos said he made these arrangements because of advice given to him by an officer at the Child Support Agency. He had previously been paying maintenance at $280 per month but was unable to continue those payments when his weekly compensation ceased. An alternative proposition was suggested to him by the Child Support Officer that he offer his wife $20,000 in discharge for future liability for maintenance. He said he was unable to do this but preferred to transfer the house to her on trust because it would satisfy his needs of ensuring that the children had a secure place to live. He said that had the property been transferred into the name of his wife only that the children were at risk because his wife was likely to dispose of the property. He said the deed also satisfied his needs of ensuring that the children were able to live together and that they would eventually own it. (refer T-38 p. 101-102). Mr Minos said the deed relieved him of his liability for maintenance because it records that the property was purchased by him alone and that it had been purchased "for his benefit and the benefit of his children". Despite the language of the deed the applicant said that he was aware of his reduced life expectancy, that he would provide security for his children and understood by his wife holding the property on trust for him and his children that she was prohibited from disposing it. Mr Minos said he did not consider himself as the owner and said that he had "done (his) duty". With respect to the applicant's present health he said that he does continue to consume alcohol at 3 or 4 cans of light beer per day. He attends a psychiatrist monthly and a psychologist fortnightly. A recent ultrasound of his liver showed the presence of a growth which "concerned" him. He has also recently been diagnosed with a gastric ulcer. He is prescribed medication for withdrawal from alcohol and takes 5mg of Valium 4 or 5 times per day. He consumes methadone and a slow release antidepressant. He has recently lost weight, he is unable to concentrate and suffers hot and cold sensations. He wears self-adhesive patches to assist in pain relief and believes that his asthma is worsening.
The applicant sees his children frequently but is unable to engage in any physical recreation. He says that his access to them is confined to either walking or attending a picture theatre. He suffers from wide variations in mood and suffers depression. Because he is unable to work and earn an income he believes that he has failed because he cannot provide. He frequently recalls his ambition to improve himself by attending school and seeking promotion. He is upset also that his health has deteriorated from a state of being fit, active and healthy.
He described his reduced life expectancy as "being like a time bomb". Mr Minos said "all I am doing is to attempt to maximise the years that I have left".
In cross-examination Mr Minos said that he and his wife separated in 1995 and he suffered back injury in October 1995. He re-affirmed his earlier evidence that he had been told by his barrister and by a loans officer at a bank that he probably would not be exposed to a preclusion period because of his personal circumstances. When confronted with a memorandum from the child support agency recording that he had told an officer that he would not be able to meet maintenance payments until the year 2002 when his preclusion period expired Mr Minos said he had no memory of this.
With respect to the negotiations to settle his common law proceedings, Mr Minos said that "all I wanted to do was to settle and get a bigger house". He said he had debts mounting and his solicitors were pressing him for fees. He said he believed he would receive social security payments and believed that the advice given to him by his barrister was accurate. He said he did not contact Centrelink to obtain independent advice as to a preclusion period because his barrister "had 30 years experience and I took his advice". In any event Mr Minos said that he filed routine forms with Centrelink in June 1999 (before settlement) and was not then told anything about a preclusion period.

Mr Minos was also taken to a number of documents completed by his solicitor being communication to and responses from Centrelink in anticipation of settlement. At page 187 is a form completed by Centrelink estimating the preclusion period on the basis of a notional settlement of $150,000. At page 192 of the T-documents is a memorandum prepared by the Child Support Agency referring to a proposed settlement of $150,000 and recording similar dates as to the period of preclusion. Mr Minos said that he did not know about these documents or the discussions between his solicitors and Centrelink until such time as all of his legal costs were paid and he obtained his file. Mr Minos was unable to explain that the memorandum at page 192 referred to discussions between him and the Child Support Agency (as opposed to his solicitors and the Child Support Agency).
Mr Minos explained that he purchased the property at Bluebell Court because the house at Gibbons Drive had become "cramped". He said his daughter needed her own room, his eldest boys fought and one of them wanted to bring his girlfriend home. He said the Gibbons Drive property had no garage or out buildings however the Bluebell Court property had four bedrooms and a large rumpus room. It also had a double garage. It was also purchased in anticipation of some of the monies having previously been advanced to his solicitors being refunded on settlement of the proceedings. It was anticipated that Mr Minos could then spend those monies either on the property or to purchase furniture. Unfortunately none of the monies paid by the applicant to his former solicitors have been refunded despite his belief that a costs order was made.
Mr Minos denied that the property was transferred into the name of his wife to avoid the threat that had been made to him by his solicitors of bankruptcy. He said that he was concerned only to provide for his children and the property was transferred into the name of his wife on trust with the advice of other solicitors. He said "at about this time I was very sick, I didn't know entirely what I was doing. I had lost confidence in solicitors. I settled without their knowledge and I was involved in a dispute about costs. I just wanted to settle and finish this". Additionally he said, the house was not purchased to avoid his liability for child support. He said it was to ensure that his children were secure and the trust was established in his belief that it would prohibit his wife from asserting any legal interest in the property.
With respect to the conclusions made by the SSAT in their decision of 4 May 2000 Mr Minos said that the deed of trust between he and his wife had previously been executed. He challenged therefore the conclusions at paragraph 19 that he "currently owns a property" and "Mr Minos is not prepared to sell this property to free up some capital". He said that he never had any intention of selling the property or wanting to "free up some capital". He said transferring the property into the name of his wife but also entering into a trust satisfied his objectives of providing his children with a secure place to live and prohibiting his wife from selling the property (to the detriment of his children). Mr Minos said he was upset by the conclusions reached by the SSAT at paragraph 19 and rang the Registrar after he received a copy of the decision confirming that at the date of hearing he was not the owner of the property.
Jenny Hunter
Ms Hunter is a financial counsellor employed by Kildonan Child and Family Services, a division of the Uniting Church.
Ms Hunter said she first consulted Mr Minos in June 2000 when he brought with him a bundle of papers being the history of his dealings with the SSAT, Centrelink and his solicitors. She said Mr Minos told her of his financial background, his compensation claim, his injuries and his borrowing's. She said "he did not know what to do". At presentation she found his history to be very confusing and the applicant was vague and agitated.
Ms Hunter said that she recalled commenting to him that she thought it was a "shame" that he had paid so much in costs to his solicitors. On the documents available to her she noted that Mr Minos was initially advised that his party/party costs would be in the vicinity of $7,000 however she noted from the documents that he had paid in excess of $35,000. She said she is currently negotiating with his solicitors as to the quantum of these costs and while she is confident that he will receive some refund it would not be sufficient to discharge a liability to his parents presently at $16,000 and a liability to his nephew of $28,000.
Ms Hunter said that she has subsequently attended Mr Minos on many occasions and has sought advice for him from the consumer legal credit co-operative, from his former solicitors, the Workcare insurer and from his current solicitors. He is presently relying on welfare agencies including the Salvation Army. Apparently the Smith Family has rejected applications made by him because of a policy not to support single males. She said Mr Minos has no capacity to secure finance elsewhere because he has no means of repayment. She said "all he has is debts and a history of debt".
With respect to the real estate, Ms Hunter said that she would not have expended the monies in the manner that Mr Minos did but she "had different priorities". When asked to comment on whether it was prudent for him to increase his mortgage by purchase of the second home, Ms Hunter said "he had eight persons to accommodate". She thought from the medical reports that she had read that his illnesses and his medication "blunts his judgement".
Ms Hunter thought that the applicant had very limited opportunities for employment if the preclusion period continued and thought that the only opportunity for work that he might have would be as a house supervisor for example in special accommodation where he would obtain free board but thought that he would be unlikely to secure this type of employment because of his medication and because of his illnesses. Otherwise she said she could not "see him surviving the preclusion period". She thought his financial situation was worsening because "handouts" from his nephew were mounting. If the preclusion period were to end and Disability Support Pension was paid, she thought he would be able to find modest accommodation and enter into a plan to repay his debts. If arrears of Disability Support Pension were paid she said she would assist him to make arrangements to repay debts.
The Legislation
The respondent has imposed a preclusion period upon the applicant during which time he is not entitled to receive Disability Support Pension.
This is because s.17(1) of the Social Security Act 1991 determines that a Disability Support Pension is a "compensation affected payment". Section 17(2) provides that "compensation" means a "payment of damages". For the purposes of calculating the preclusion period, 50% of the compensation part of the lump sum is brought to account. (Section 17(3)). The respondent is entitled to impose a lump sum preclusion period having regard to the provisions of s.1165(1A) because the applicant has received a "compensation affected payment", he is "not a member of a couple" and he has received a lump sum compensation payment after 20 March 1997. The formula for calculating the "new lump sum preclusion period" is found at s.1165(8).
Much of the above is not in dispute. What is in dispute in this application is whether the secretary of the respondent may "disregard" the whole or part of the compensation payment as not having been made or as not liable to be made (refer s.1184(1)). The Secretary is to consider whether to regard the whole or part of the compensation payment as not having been made, or not liable to be made if there are "special circumstances of the case" (s.1184(1)).
Conclusion & Reasons For Decision
In Re Beadle & Director General Social Security 1984 6 ALD 1 at p. 3 the Tribunal said-
"an expression such as "special circumstances" is by its very nature incapable of precise or exhaustive definition. The qualifying adjective looks to circumstances that are unusual, uncommon or exceptional. Whether circumstances answer any of these descriptions must depend upon the context in which they occur. For it is in the context which allows one to say that the circumstances in one case are markedly different from the usual run of cases. That is not to say that the circumstances must be unique but they must have a particular quality of unusualness that permits them to be described as "special"".
The above extract has been referred to on many occasions in many subsequent decisions of the Tribunal concerning applications where consideration of the concept of special circumstances has been considered. That the words "special circumstances" are "incapable of precise or exhaustive definition" have almost a prophetic meaning, having regard to the multitude of applications where the individual circumstances of persons have been considered to determine whether those circumstances are "special".
Since 1984 (when Beadle was decided) the Tribunal has considered financial hardship (sometimes extreme financial hardship), divesting assets or holding assets on trust, meeting and/or discharging debts, negligent advice, illness, and management of settlement monies (to name a few) when deciding whether a person's circumstances are 'special'. Those circumstances are illustrative of the discretion to be exercised by the Tribunal and the inquiry into a person's circumstances. The object and intent also of the legislation is necessarily taken into account and in the context of the imposition of a preclusion period where a person has received a lump sum award of compensation, the Tribunal often refers to the legislation intending to prevent a person drawing on the "public purse" during a period of time when the compensation monies are intended to represent lost income.
Rarely does an applicant come to this Tribunal where one issue alone is to be considered when assessing whether circumstances are special. Indeed to consider whether circumstances are "unusual, uncommon or exceptional" the Tribunal in Re Beadle concluded (at page 4)-
"But it is not helpful to focus too closely on each particular circumstance of the applicant and ask whether it is special. Of itself it is unlikely to be special for there would be many in a similar situation. The question is whether, when the relevant circumstances of the applicant are looked at in their entirety, they may fairly be described as unusual, uncommon or exceptional so as to warrant payment of the allowance earlier than the date from which it would ordinarily be paid".

Whilst Beadle was not concerned with a preclusion period its comments no less continue to remain relevant and I have been mindful of them in this application, being one in my view of extraordinary complexity yet no less moving and compelling. For reasons which will follow, I am satisfied that the circumstances of the applicant are "special".
The preclusion period imposed in the present application is two weeks short of five years. The applicant has been precluded for approximately 14 months to date from receipt of a Disability Support Pension. In that time he has had no income. For reasons, which will follow, he has divested all of the compensation monies. At the present time he lives on handouts from a nephew. The sum total of the monies received to date from his nephew approximate $28,000. He has for a period also received handouts from his parents but it would appear that their charity (so far as it extends to advancing money) has ended. The applicant who is presently 41 years now lives with his parents, however there appears to be a great deal of friction between the applicant and his parents in view of the applicant having exhausted his parents' life savings in order to meet his significant solicitor's fees. On the evidence of Ms Hunter – with which I agree – it would be unlikely that Mr Minos would secure borrowed funds from a commercial source because he would have no capacity to repay nor with his financial history would he present as a person suitable to whom monies should be advanced. By reason of the multitude of illnesses and injuries from which he suffers he has continuing liability for medical and pharmacy costs.
I would prefer not to conclude that the applicant has been imprudent or reckless or careless or responsible for his own misfortune when consideration is given to the manner in which his funds have been expended. Language of this type is frequently used in decisions of the Tribunal when considering special circumstances in the case of persons who have divested lump sum payments often within the short time of receipt. The applicant did expend almost all of his settlement funds in the purchase of a property for his children. So committed is he to their welfare and future security that he entered into a trust with his former wife to ensure that the property could not be sold by her. This is an extraordinary scenario and is illustrative of the applicant's commitment to care for his children and to ensure that they do have a stable domestic environment. Whilst that environment is without the presence of two parents – he does not even live in the house – it is indicative of his commitment to ensure that his children and the two children that he adopted from his wife's former relationship are not at risk of becoming homeless as was his wife when she was an infant. The applicant was also motivated to provide a stable environment for the two eldest children, (being children of his wife's former relationship) because there was a period when they were also in foster care. He has obtained no benefit at all from the purchase of the property other than piece of mind. Subject to what interpretation may be placed upon the relationship between the applicant and the child support agency, it may be submitted that he could have extinguished his maintenance liability by payment to his wife of $20,000. That would not have provided the children with a secure domestic environment nor would it have met his objectives of acquiring a property which would provide them with a home on a long-term basis, such was his concern as to the instability of his wife.
It may be that other persons from different social or cultural backgrounds would not have acted in the way that the applicant did in expending his settlement funds. But each person's circumstances are necessarily different. Fortunately as mere mortals we all act differently and the overwhelming feature of the applicant's conduct has been for the care of his children. This no less has resulted in his own detriment because he has no funds, no income and does not live in the house.
Such was the applicant's commitment to ensure that funds were obtained to purchase a home for his children – which was bigger than the former home – that he ignored the advice of his solicitors and with the assistance of a mediator entered into negotiations with the Workcare insurer to settle at a sum considerably less than his solicitors had recommended. Whether he would have secured a greater amount upon a jury verdict is another issue and incapable of a finding by this decision yet faced with his reduced life expectancy, his commitment was to obtain funds as quickly as was possible to meet his objective of purchasing a property for the benefit of his children.
His financial insecurity was subsequently worsened by legal action brought against him by his former solicitors to recover party/party costs. That disputation continues and whilst I accept as a fact that the applicant believed that his real estate was at risk upon entry of any judgement by his solicitors against him, I am not satisfied that the property was transferred into a trust in order to avoid the legal action which was undertaken by the solicitors. Indeed some of the monies that had been borrowed from his parents & nephew were used to discharge the financial obligation to his solicitors for party/party costs which, on the evidence were discounted (at the suggestion of the solicitors) by payment in cash.
The applicant has been unable to date to satisfy the respondent that his circumstances are "special" because in part he failed to obtain advice from Centrelink as to whether there would be a preclusion period and if so what its duration would be. This is because in part he did fail to seek advice from appropriately qualified persons but relied on the advice of a loans officer at a bank and from a barrister (who should have known better) that it would be unlikely that a preclusion period would be imposed because he had a mortgage. It would appear the applicant relied on the advice of the barrister and the loans officer as persons who held themselves out to be familiar with preclusion periods and whether the applicant may be exempt. It would be harsh to expect the applicant to institute legal proceedings for negligent advice when he does not have the funds to do so. Whilst there were letters within the T-documents from the applicant's former solicitors to Centrelink inquiring as to the probable duration of a preclusion period I accept and find as a fact that that correspondence was not known to the applicant nor did he have access to it until after his claim was completed and he obtained his file. There is no evidence that the enquiries made by the solicitors were ever discussed or communicated to the applicant.
In the context of the applicant's health, it is beyond doubt that he is very sick. The evidence of Dr Kouzmin was graphic and it is not in dispute that the applicant has a severely reduced life expectancy. Dr Kouzmin estimated it to be "10 years at the most". She was fearful that the terminal stages of liver disease have commenced. If this is so the life expectancy will be much less than 10 years. The applicant of course needs an income to meet his pharmacy costs, which are considerable. He consumes considerable quantities of medication, all of which are of an unusual and extraordinary nature because the extent of his illness precludes him from consuming traditional painkilling medication. He is incapable of working and has no means of securing an income elsewhere.
In Groth v Secretary, Department of Social Security 1996 40 ALD 541 at 545 Kiefel J considered the expression "special circumstances", referred to Beadle and stated that to distinguish the appellants case from others it would have to "take it out of the usual or ordinary case". Her Honour said when referring to the above-
"That was, I consider, the only enquiry to be undertaken in this case. It would of course follow that if one were to conclude that something unfair, unintended or unjust had occurred that there must be some feature out of the ordinary".
It is my view that the above sentiment applies to the present review.
In Director General of Social Services v Hales 1983 47 ALR 281 at 321 Sheppard J said-
"I turn to consider the Director General's fourth submission. I should first state my conclusion on the question of whether or not it is appropriate for the Director General to take into account compassionate considerations in determining whether or not to institute proceedings for recovery. In my opinion it plainly is. The legislation provides for the payment of a variety of benefits to different classes of people who will usually have one thing in common: they will be impecunious and in straightened circumstances. Very often their stories will be quite tragic".
Whilst Hales concerned an overpayment of Social Security the above considerations no less apply to the present review.
Whilst the intention of Parliament with respect to the imposition of a preclusion period is well known and the public is entitled to the confidence in the proper administration of a social security system by not paying welfare payments to persons who have received compensation lump sum, the existence of a discretion to the Secretary, to disregard the whole or part of compensation monies is in recognition that persons' circumstances will differ.

In the context of social welfare legislation which must be interpreted beneficially, no social, legal, economic or moral argument can prevail to cause the applicant in this case to endure continuing and extreme financial hardship when the totality of his circumstances are considered.
After a thorough examination of his circumstances as was obtained following the hearing of this application and having had the benefit of commendable submissions by the representatives of both parties I am left with no doubt that the applicant's circumstances are special.
If his liver disease has reached the commencement of a terminal phase whilst in his lifetime he has achieved his objective of providing real estate for the benefit of his children, it is unlikely that he will survive to enjoy their adolescence. No fair-minded person exercising even a modest degree of compassion would deny payment to Mr Minos of Disability Support Pension. That he should be expected to endure the remainder of the current preclusion period (another 4 years) would be intolerable.
Until 6 March 2000 the applicant was the owner of real estate. It was on that date that he divested himself of it and the trust deed was executed. At or about that time, all settlement funds had been expended. I am satisfied that part of the compensation monies should not be regarded as having been made and the preclusion period should end at 7 March 2000.
I certify that the 64 preceding paragraphs are a true copy of the reasons for the decision herein of Mr J. Handley, Senior Member
Signed:         .....................................................................................
  Secretary
Date/s of Hearing  27 October 2000
Date of Decision  8 December 2000
Counsel for the Applicant        Mr Serong
Solicitor for the Applicant         Holding Redlich
Counsel for the Respondent    Ms C. McInnis